MacKenzie Realty Capital Reports Revenue Growth but Wider Net Loss in Latest 10-Q Filing

MacKenzie Realty Capital, Inc. reported significant financial developments in its latest 10-Q filing for the period ending December 31, 2024. The company generated $8.03 million in rental, reimbursements, and other property income for the three months ended December 31, 2024, a substantial increase from $3.58 million in the same period last year. For the six months, total revenue reached $12.98 million, compared to $7.14 million in the prior year. This growth is attributed to the acquisition of three office buildings and an early lease termination income of $3 million from a tenant at the Satellite Place Office Building.

Despite the increase in revenue, MacKenzie Realty reported a net loss of $5.28 million for the three months ended December 31, 2024, compared to a loss of $1.94 million in the same quarter of 2023. The six-month net loss also widened to $13.42 million from $6.54 million year-over-year. The losses were primarily driven by increased operating expenses, which totaled $12.59 million for the quarter, up from $5.94 million in the previous year, largely due to higher depreciation, interest expenses, and an impairment loss of $9.5 million related to the Main Street West Office Building.

Operationally, the company has expanded its portfolio, acquiring the Green Valley Medical Center in August 2024 for $3 million, which was financed through the issuance of preferred units. As of December 31, 2024, MacKenzie Realty owned nine commercial properties and four residential properties, with a total asset value of approximately $236.36 million. The company also reported a decrease in cash and cash equivalents to $6.14 million from $11.78 million at the end of June 2024, reflecting cash outflows for acquisitions and operating expenses.

In terms of strategic developments, MacKenzie Realty has been actively managing its capital structure, raising approximately $119.1 million from common stock offerings and $18.61 million from Series A preferred stock offerings. The company has also entered into a revolving line of credit agreement for up to $10 million to support its liquidity needs. Looking ahead, MacKenzie Realty plans to continue its investment strategy focused on real estate assets, while also addressing the challenges posed by rising interest rates and market conditions that could impact its operational performance.

The company’s outlook remains cautious, as it navigates the complexities of the current economic environment, including inflation and interest rate fluctuations. Management emphasized the importance of maintaining a diversified portfolio and leveraging its operational expertise to enhance shareholder value while managing risks associated with its investments.